Deputy Prime Minister Nick Clegg has announced that an action plan dedicated to boosting manufacturing supply chains will be put in place from early next year. The ambitious action plan aims to deliver a multi-billion pound lift for British industry.
The Department for Business and Skills will publish and implement the action plan to address some of the challenges UK supply chains face in tackling skills gaps and adopting innovation and accessing in business finance. It will focus on ensuring UK companies can look to source products from local companies rather than relying on overseas manufacturers. The Government will work in partnership with leading employers to develop the plan, alongside the Industrial Strategies.
Extensive work has been undertaken by Government and industry to implement Industrial Strategies for key sectors like aerospace and automotive. But there is yet to be a coherent plan put in place for the vital networks of suppliers that are crucial to making and building things in the UK. The CBI estimates that the UK could unlock around £30 billion and generate up to 500,000 more jobs over the next decade by strengthening our domestic supply chains.
Despite the UK automotive sector being one of our biggest manufacturing success stories, UK vehicle makers still import more than £11 billion-worth of components annually, only sourcing around 40% of their parts from domestic suppliers, compared to over 60% in Germany and France. By 2020, it is estimated that there will be around £40 billion worth of renewable electricity projects in the UK and projections show the offshore wind sector alone could support 30,000 supply chain jobs. Yet only around 20% of the components needed to build our offshore wind farms are being sourced right now in the UK.
Deputy Prime Minister Nick Clegg said:
By WEF (2011)
“Every successful company is only as good as its supply chain. The last four decades have seen the UK’s manufacturing base increasingly forced to compete with low-cost economies for investment, jobs and growth. Some businesses have struggled and it has resulted in a hollowing out of the UK’s domestic supply chains with over half the supplies used in British manufacturing coming from overseas.
“This cannot go on. That’s why I’m acting now so we can get off this merry-go-round where a manufacturer shifts production overseas and the local companies that support them lose vital business. These supply industries are huge, important sectors in their own right – from our steel makers, petrochemical companies and glass producers, all the way down to car seats manufacturers – all of which employ thousands of people and generate millions for our economy.”
From the New Year, the plan will build on the work that the Government has already done to help secure the growth of the manufacturing industry – including through the Regional Growth Fund, the Advanced Manufacturing Supply Chain Initiative, Reshore UK, the Manufacturing Advisory Service and greater support for employer-led skills training.
The Deputy Prime Minister continued:
“There is much more that can be done to keep business at home when it comes to supplying the manufacturing industry with the parts they need.
“From the steel needed for car production, to the wings and control systems for planes, these industries rely day in day out on the parts they use – from the tiniest of nuts and bolts, to gearboxes, car seats and vast wind turbines.
“Ensuring UK companies are equipped to produce the parts the industry needs to thrive will push the pieces of the jigsaw closer together, creating a more joined up approach to manufacturing business in the UK.”
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Tags: deputy prime minister, manufacturing, News, nick clegg, supply chain, uk economy
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